Another ally of the Chevron Shakedown bails out

Talk about persistence. The ongoing saga of the Ecuador Chevron Shakedown has been playing out for years now but it’s still not over. Even though Big Apple attorney Steven Donziger has been knocked down repeatedly in the courts and seen a judge declare his efforts to grab billions of dollars from the energy giant a massive fraud, Chevron isn’t done with either Donziger or his associates in the scheme. They have been going after the various firms which fund major lawsuits in exchange for a share of the profits if a judgement is achieved and one after another has fled the field of battle.

That trend continued this week as a California litigation services firm bowed out.

Chevron Corporation (CVX) has reached a settlement agreement with H5, a California-based e-discovery and litigation services firm. In the settlement, H5 has withdrawn its support from the litigation against Chevron in Ecuador and has assigned its 1.25 percent interest in the $9.5 billion Ecuadorian judgment to Chevron. In 2014, Chevron obtained court-ordered discovery from H5 for the company’s role in supporting and advancing the lawsuit led by Steven Donziger, which a federal judge found to be tainted by fraud.

“Chevron is pleased that H5 has ended its association with this scheme,” said R. Hewitt Pate, Chevron’s vice president and general counsel. “Chevron is also pleased that H5 has taken the further action of disclaiming any interest in the Ecuadorian judgment and relinquishing its interest to Chevron. It remains Chevron’s intent to hold accountable those responsible for what a federal judge found to be a fraud.”

The key portion of this agreement is not that H5 is backing out, but that they are signing over any interest they had in the settlement to Chevron. Even if there were to be some sort of judgement awarded to the petitioners at this point (which is unlikely in the extreme) a significant portion of the award would be going back to Chevron anyway.

H5 is only the latest to follow this pattern. As we reported earlier this year, Woodsford Litigation Funding Limited, Temeraire Limited, Kohn, Swift & Graf, Burford Capital LLC, Stratus Consulting and Russ DeLeon all dropped out under similar circumstances and signed over their share of the proceeds to Chevron. This is starting to look like it’s going to take the better part of a decade, but the company is clearly willing to go the full nine yards and chase every last participant back to their home offices. And it’s not over yet.

Chevron still has claims pending in Gibraltar against Amazonia Recovery Ltd., a Gibraltar-based company set up to receive and distribute funds resulting from the Ecuadorian judgment, and Pablo Fajardo, Luis Yanza and Ermel Chavez, who are directors of the company. Chevron has alleged that Amazonia is merely a vehicle to perpetuate the ongoing fraud.

Gee… do you think the name “Amazonia” was a bit of a dead giveaway? They set up an entire company for no other purpose than to vacuum up some of Chevron’s money if Ecuador and Donziger had prevailed. I wonder who eats the losses on that one now that the entire outfit’s raison d’etre has melted away?

In case you’re new to this story, you can catch up with all of our coverage of the Chevron Shakedown saga dating back further than I’d care to remember here.